Bank infighting rather than iPhone 5 holding back contactless revolution says expert

By Peter Gothard
21 Sep 2012 View Comments

Apple has been accused of holding back the advance of near field communication (NFC) technology with its decision to launch the iPhone 5, which went on sale today, without the much-rumoured NFC-based contactless payment facilities.

But Mark Sutherland (pictured), president of IT asset management solutions company Kaseya, holds international banking corporations far more responsible for NFC's sluggish progress.

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"I think the NFC revolution is already being held back by fights between Visa, American Express and Mastercard," said Sutherland, "and everybody wanting to have their own proprietary piece in there. Google got in there and offered a solution and everybody said ‘Oh, I'm afraid of Google, I don't want them taking over the universe' – that's what's holding it back."

Sutherland suggested that in order for Apple to successfully launch NFC-support in iPhone 5s today, a substantial amount of – currently absent – retail support would already need to be in place.

"You need to have a whole ecosystem growing," said Sutherland. "NFC is driven by payment systems, payment is driven by retail. If I can't use it in a retail store, get in and get out, I'm done. And if I go in one of the hundreds of little retail stores who use Kaseya, we have a ton of them whose retail terminals are on dialup. My god, talk about resistance. If I'm going to change out my cash register, that's the scariest thing to me as a retailer – because that cash register is my world. They're not going to do it until they see everyone else do it."

But the unwillingness – or even lack of need – for banks to engage could, said Sutherland, mean the process may be held up indefinitely.

"Visa, Mastercard and American Express can drive it if they stop fighting," said Sutherland. "And these are companies who can't possibly spend all the money they're making – so what's their motive?

"Companies get motivated because someone else is going to take their market share. If you've already got 100 per cent, you're not too worried about it. So I see some inertia being a problem."

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